Outsourcing is up, but businesses are sourcing local IT staff

Businesses are moving away from overseas suppliers in favour of companies able to provide the same services locally, according to a survey from online business marketplace PeoplePerHour.com.

The company surveyed 50,000 business users on their attitudes to outsourcing.

Some 60 per cent of UK businesses are outsourcing more now than they did two years ago, largely owing to the recession.

But, counterintuitively, 61 per cent of businesses are now choosing to outsource their IT requirements to local rather than overseas suppliers, which is potentially more costly.

This is corroborated by additional research from PeoplePerHour.com which shows that only 6.9 per cent of businesses award projects to the lowest bidders. Other factors including trust and ability to communicate easily are as important when making a decision on where to outsource IT work.

“You might have expected offshoring to grow through the recession as UK businesses looked to cut costs by outsourcing IT requirements to cheaper overseas suppliers,” says PeoplePerHour.com founder Xenios Thrasyvoulou.

“However, it is clear that outsourcing is growing and offshoring is falling,” he added.

The fall in offshoring is partly attributable to the recent rise of the UK’s freelance economy and the growing availability of skilled IT professionals offering their services on a freelance basis, according to the company.

PeoplePerHour.com also argued that many IT professionals who were made redundant during the recession turned to freelancing, thereby increasing the availability of skilled IT professionals to companies looking to outsource.